Post-traumatic stress disorder (PTSD), a chronic and disabling anxiety disorder that results from exposure to a traumatic event, is associated with marked deficits in behavioral as well as social and occupational functioning. United States (U.S.) military Veterans? risk of developing PTSD is high, lifetime prevalence of PTSD among Vietnam Veterans is estimated at 19%, while among OEF/OIF soldiers and Veterans, approximately 17% of active duty soldiers and 25% of reserve soldiers from the Iraq war met criteria for PTSD. Current practice for diagnosing and managing PTSD relies primarily on subjective clinical assessments by clinicians as well as patient self-report. An independent, objective and neuro-physiology based method for directly assessing brain function is not available, but is much needed to improve diagnosis and management of PTSD. This need is highlighted by recommendations from the Institute of Medicine, National Academy of Science (IOM-NAS), which conducted a comprehensive assessment of the current PTSD diagnosis and treatment methods and identified potential shortcomings of current diagnostic and treatment techniques. A major recommendation by the IOM-NAS was the urgent need for development of methods for more precise and objective diagnosis of PTSD and its severity level, objective and faster evaluation of treatment efficacy, and ability to predict who might be at risk of relapse. To address the critical need for developing objective methods for diagnosis of PTSD, determining its severity level, and potentially predicting treatment response, we propose to test novel biomarkers which are based on measures of coherent activity among the regions of cerebral cortex during sleep. The selection of this test condition (sleep) was motivated by the extraordinarily high prevalence of sleep disturbances in individuals with PTSD, so much so that some have postulated that sleep disturbances are a hallmark feature of the disorder. In preliminary studies on EEG acquired during sleep from Veterans with PTSD alone (n=38), TBI alone (n=30), PTSD and TBI (n=25), and no PTSD or TBI control group (n=38), we have shown that a set of neuromarkers were highly sensitive/specific to the presence of PTSD, and highly sensitive to the severity of symptoms in PTSD group. The overall goal of this Merit project is to validate this novel neurophysiology marker in: (1) retrospective study, where the analyses will be applied to a large existing database (n=656) of health-related quality of life and functional outcome measures, as well as sleep EEG recordings, from Veterans with PTSD only, with TBI only, with both PTSD and TBI, with depression only ( no PTSD or TBI), and controls (no PTSD, TBI, Depression, Sleep Apnea), (2) prospective study 1 with PTSD (n=10) and control (n=10) where we will evaluate potential improvement on the performance of the neuromarkers using a dense array (64 channel) EEG montage , and (3) prospective study 2 in a cohort (n=50) of Veterans undergoing psychotherapy, where we will evaluate the sensitivity of neuromarkers to the improvements in PTSD symptoms, and other functional and health related quality of life measures, in response to psychotherapy.